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Petitioners’ return is stamped as received by the IRS’s
Fresno, California, office on October 25, 1990. There is no
evidence of a postmark or receipt for a certified mailing.
Petitioners’ 1990 Return
Petitioners claimed a net operating loss carryover of
$5,011,913 on their timely filed 1990 return. This was the
portion of the claimed $8 million loss that was not used in 1989.
The return was signed by Mr. Johnson as preparer.
Petitioners claimed a deduction of $30,000 for legal fees
and expenses allegedly paid to Fariborz during 1990. Petitioners
provided documents evidencing the following: (1) That petitioner
transferred $5,000 (total charge of $5,025 including fees) to
Fariborz’s Iranian bank account (through Melli Bank of Iran in
Los Angeles) on June 15, 1990; and (2) petitioner signed two
checks drawn on the Huntington Harbor account for $5,000 each
payable to Fariborz dated August 20 and November 14, 1990.
Petitioners did not provide any bills, receipts, or other
documentation which would detail what these amounts were used to
pay. Mrs. Ahadpour testified that these amounts were for
Fariborz’ expenses in connection with the criminal prosecution of
Ammareh.
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